Nationwide Insurance - Building an Effective Finance Control and Fast Book Closing BI-System


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Nationwide Insurance - Building an Effective Finance Control and Fast Book Closing BI-System

  1. 1. Nationwide Insurance Building an Effective Finance Control and Fast Book Closing BI-System Challenges & Best Practices 4th Workshop on Business Intelligence 07.05.2010, TU Dresden Dr. Georg Loepp Business Development Manager Banking - Insurance – Healthcare
  2. 2. Agenda Teradata Overview Teradata – Focus on enabling Technology und References Nationwide - Company Overview Nationwide - Challenges of the Finance Function Nationwide - Program Results Q&A 2 > 6/17/2010
  3. 3. Agenda Teradata Overview Teradata – Focus on enabling Technology und References Nationwide - Company Overview Nationwide - Challenges of the Finance Function Nationwide - Program Results Q&A 3 > 6/17/2010
  4. 4. Teradata Overview 1,800 Revenue 400 Operating Income 1,600 Results 2009: 300  Revenue: $ 1,709 Mrd. 1,400 200  Income: $ 338 Mio. 1,200  CEO: Michael Koehler 100 1,000 0 02 03 04 05 06 07 08 09 02 03 04 05 06 07 08 09 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20  Teradata Corporation is a global leader in data warehousing and analytic solutions. Our customers use our market-leading technology to gain deeper insight into their business operations to drive growth, profitability, and competitive advantage.  Over 925 customers, mostly Fortune Top 500 customers with more than 2400 Systems  More than 6600 professionals dedicated to data warehousing  Targeted Industries: Retail, Telecommunication, Media & Entertainment (TME), Financial Services, Manufacturing (Automotive, Semiconductor, High Tech), Travel & Transportation, Government, Utilities  Again #1 position in the leader quadrant of Gartner’s Data Warehouse DB Magic Quadrant, 2010 and for the nine consecutive year leading Gartner’s DWH Server Model  Since Oct 1st, 2007 listed as an independent (split from NCR) and publicly traded company at the NYSE (S&P 500); ticker symbol TDC  Extended partnership with IT-Partners for realizing in-Database functionality 4 > 6/17/2010
  5. 5. Agenda Teradata Overview Teradata – Focus on enabling Technology und References Nationwide - Company Overview Nationwide - Challenges of the Finance Function Nationwide - Program Results Q&A 5 > 6/17/2010
  6. 6. The Solution of the business Problem Building Data Marts result in fragmented, inconsistent Data with considerable higher operation times. Herefrom less funded Decisions & even Reputation-risk arise through missing Data security & Compliance. For the Operations and the Development of these systems occur verifiable significantly additional Cost. Integrated Data guarantee the Consistence and Usability of Information, with simultaneously highest Security using a central Data Protection. Thereby Decisions could be taken much quicker, better and traceable, and this with significantly less Costs 6 > 6/17/2010
  7. 7. Teradata Vision: Active Enterprise Intelligence Teradata: A central integrated View on your Business Hub & Spoke 1. Application specific Central - 1. Business specific Star schema 2. Unflexible during changes Flexible - 2. Easy to change Point2Point- 3. Prone to Inkonsistencies 3. Longterm stable Foundation 4. Denormalised –Redundant 3. Normal Form 4. Normalised – Non redundant Implementation 5. Irreproducible 5. Audit Proof Strategic View Strategic View Production Finance Risk Marketing Sales Production Finance Risk Marketing Sales consistent logcal View Konto- Haupt- Risko- Kunde Filiale Vertrag buch modell Konto- Vertrag Haupt- buch Risko- modell Kunde Filiale ORDER ORDER ORDER NUMBER Logical Data Model ORDER NUMBER ORDER DATE ORDER DATE STATUS STATUS ORDER ITEM BACKORDERED ORDER ITEM BACKORDERED QUANTITY QUANTITY CUSTOMER CUSTOMER CUSTOMER NUMBER CUSTOMER NUMBER CUSTOMER NAME CUSTOMER NAME ORDER ITEM SHIPPED ORDER ITEM SHIPPED CUSTOMER CITY CUSTOMER CITY CUSTOMER POST QUANTITY QUANTITY CUSTOMER POST CUSTOMER ST SHIP DATE SHIP DATE CUSTOMER ST CUSTOMER ADDR CUSTOMER ADDR CUSTOMER PHONE ITEM CUSTOMER PHONE ITEM CUSTOMER FAX ITEM NUMBER CUSTOMER FAX ITEM NUMBER QUANTITY QUANTITY DESCRIPTION DESCRIPTION Accounting Gen. ledger Customer Channel Accounting Gen. ledger Customer Channel Transaction Cash Flow ERP … Collection Transaction Cash Flow ERP … Collection 7 > 6/17/2010
  8. 8. Analyst View: Proven DWH Technology Teradata: Active Enterprise Intelligence based on Data Warehousing Gartner: Magic Quadrant for Data Warehouse Systems "Teradata is proprietary." This is a false claim, as the DBMS is no more proprietary. Today, Teradata runs on commodity hardware and Linux, and is even replacing the proprietary BYNET with InfiniBand and other standard interconnects. interconnects Teradata allows customers to engage in several market microtrends… … addresses the "learn as you grow" mentality. Source: Gartner Research, Magic Quadrant for Data Warehouse Database Database Management Systems, Donald Feinberg, Mark A. Beyer; Publication Date: 28 January 2010/ID Number: G00173535 nine consecutive years leading 8 > 6/17/2010
  9. 9. TD Strategic Directions We Address High Analysis Quality = Performant Data Warehouse Multidimensional Query Concurrency Scalability Simultaneous parallel Guaranteed Linear execution of complex Scalability of the solution queries Scan Optimization Ease of Use At any point in time the Easy map complex issues fastest result on offered solutions Multiple Appliances Integrated Data Expandable dependent on Single point of truth the business requirements Consistent Performance Agile Analytics Guaranteed SLAs Right time decision support and effective early warning Availability Active Workload 7*24 Up and running Automatic prioritization and optimal resource mitigation Investment Protection Multi Temperature Guaranteed business Automatic user profile improvement oriented use of information 9 > 6/17/2010
  10. 10. Teradata Customers Customers: Active Enterprise Intelligence for Top Companies worldwide Finance Media Retail Logistics & Industry Public • Market leader of all Tourism Institutions industries are using Teradata-Systemes for Decision Support • 35 New Customers in EMEA within the last 24 Month (e.g. HSBC, Unicredit, Daimler, Nokia, etc.) • Loyality rate of the Teradata Customers > 99%. • The Teradata Community (Customer, Science Departments and Employee) is constantly working on the Development of best in class solutions 10 > 6/17/2010
  11. 11. Agenda Teradata Overview Teradata – Focus on enabling Technology und References Nationwide - Company Overview Nationwide - Challenges of the Finance Function Nationwide - Program Results Q&A 11 > 6/17/2010
  12. 12. Who is Nationwide? Nationwide – Company Overview: • $157B Statutory Assets - 35.000 Employees • Ranked 98th in the Fortune 500 • Core businesses include: > domestic property and casualty insurance, life insurance and retirement savings, asset management, and strategic investments. • Full range of products and financial services > auto, fire, life, health and commercial insurance to administrative services, annuities, mutual funds and retirement plans. • Specific P&C Rankings: > 4th-largest homeowner insurer based on premiums written > 6th-largest auto insurer based on premiums written > 10th-largest commercial insurer > 6th-largest total property and casualty insurer 12 > 6/17/2010
  13. 13. Nationwide Insurance Project Spotlight Project FOCUS (Faster, Online, Customer-driven, User-friendly, Streamlined):  Situation: Nationwide wanted to have a world-class finance organization but was hindered by multiple financial processes, organizations and systems across its enterprise  Problem: This environment created a number of issues regarding a lack of timely access to information and added expenses with limited ability to optimize capital and manage risk.  Solution: Reinvent the role and operating model of the finance function to enhance its contribution to Nationwide’s future success 13 > 6/17/2010
  14. 14. Agenda Teradata Overview Teradata – Focus on enabling Technology und References Nationwide - Company Overview Nationwide - Challenges of the Finance Function Nationwide - Program Results Q&A 14 > 6/17/2010
  15. 15. Finance Key Horizontal “Hot Topics” • IFRS • Transparency / Financial > New Global Financial Reporting Reporting Standard > Enhanced transparency & > Requires more detailed data and flexibility of financial reporting reconciliation to transactions capabilities • Profitability • Expense Management > Current economic pressures > Insight into key expense items driving demand for insight to cost to manage & monitor & revenue drivers > Vendor management • Finance Architecture Redesign • ERP Migration > Simplification initiatives to drive Augmentation/Avoidance cost out while meeting new > Ability to reduce cost/risk of requirements large ERP Migrations > Approach to prolong time or avoid making the migration 15 > 6/17/2010
  16. 16. Nationwide Insurance The Finance Function Problem 2006 • Multiple G/L’s • Multiple Consolidation & Reconciliation Systems • Multiple Profitability Systems • Multiple Reporting Solutions And every one of them has its own data repository 16 > 6/17/2010
  17. 17. While many leaders have made progress on improving key enablers, significant opportunities for improvement in Finance still exist People Process • While strategies may exist, organizations do • Process and data improvements can have a not consistently manage to them big impact on closing cycle • Significant time and effort spent • Inability to react to changes in a coordinating and resolving dependencies on coordinated and collaborative way across other operating units the enterprise • Leading organizations spend more and focus • Understanding of cost and other key on planning and analytics and have higher performance drivers still insufficient retention rates • Ability to anticipate business changes • While information and tools have been hindered by insufficient leading indicators deployed in many organizations, lack of training has slowed use Information Technology • Progress has been made in basic reporting, • ERP systems not well suited to meet but addressing 21st century reporting growing analytical and reporting requirements is needed requirements • Speed, access and flexibility of • IT complexity is driving increased costs and information, not accuracy is the issue hampering collaboration across functional • Detail necessary to determine the “what, silos why and how” of results not easily • Enterprise application use growing but available for many heavy reliance on Excel still exists • Integration of financial and operational • Growing use of data warehousing and information and metrics in a consistent master data management among leading way is uncommon organizations 17 > 6/17/2010
  18. 18. The Challenge: It was time to reinvest in Finance Innovation and improved performance require investment. • Potential areas to invest in and results to expect: > Talent Management to enable improved capabilities > Financial Reference Data/Chart of Accounts to enable better control over data > Performance Scorecards to enable people to focus on doing what matters most > Business Intelligence to enable smarter decisions, while reducing risk > Financial Close Consolidation and Reporting: to enable faster, smoother close > Budgeting, Planning & Forecasting: to enable one version of the truth > Tax and Treasury: to enable higher profits and better compliance > Benchmarking: to enable understanding of performance relative to peers What to do: Identify your top three investment opportunities. Build business cases that include the value of better information, improved talent retention, & less risk. 18 > 6/17/2010
  19. 19. Finance Transformation Requires Leveraging Complementary Capabilities Acting on Process Standard Knowledge Management Reporting Recording Sharing Transactions Knowledge Operational Systems Analytic Systems Drive Business Help Run the Business Decisions Enterprise Resource Planning Enterprise Data Warehouse (ERP) > Flexible architecture optimized for business analytics and ad-hoc decision making > Structured architecture drives process efficiency and consistency in core business processes > Analytical focus – analyze and manage the business > Transaction focus - operating the business > Provides analytical flexibility and > Provide process integration across key operational customized reporting capabilities across processes business processes – Large Investment – Large Investment – Highly Visible Spend – Low Visibility Spend – Traditionally High Priority – Emerging Top Priority 19 > 6/17/2010
  20. 20. Critical Step Getting the Conceptual Architecture Right Manage All Accounting Consolidate Future proof Rules in Common Use around Standardize design Transparent Way With Applications application business Ability to Drill to Details According to clusters rules & Purpose models 1 Next Generation Finance Infrastructure 3 Accounting Financial Systems 4 HR 5 Calculation 6 Reporting Hub Engines & & Analytics 8 Source Accounting Consolidation HR Applications Systems Treatment Rules General Ledger PR Financial Reporting Planning Allocation DDA Data delivery to users & Card Sub-Ledger AP Purch AR FA PA Other processes is timely, Basel Risk accurate & appropriate Management Reporting Mtg Invest Trust 2 Data Warehouse Regulatory Reporting Call 1101 Center 1001 Operational 9 Branch 1011 7 Store once: Analytics use many times ATM Tactical Info Delivery CIF Extract once: Customer Introduction & Life-Cycle Maintenance Process System Put customer Set Status to Upload Customers state to Charge ACT IVE Logistics Update logistics information Don’t change mid-flight yes 10 Data Quality yes Sales Rep/ DSD Rep Update Customer Profile Information Overall Data Finance / Steward Hierarchy, Duplicate Resolve Credit Approval Update Billing Update Hierarchy Channel, Review Alerts resolution yes no Duplicates Reqd? Information Information Address info reqd? no complete? Alert respective role no Consistent data for all Uses Hierarchy Security Master Data Sales Update Trade Metadata Channel Information Management Management & Governance Management Workflow Management Rules Management Management End-to-End Data Transparency, Informed Real-Time Governance & Consistency Decision Making 20 > 6/17/2010
  21. 21. Agenda Teradata Overview Teradata – Focus on enabling Technology und References Nationwide - Company Overview Nationwide - Challenges of the Finance Function Nationwide - Program Results Q&A 21 > 6/17/2010
  22. 22. Nationwide Insurance Success Story Situation • Company growth strategy is through acquisitions Impact • Had a financial reporting environment dependent upon pulling • Close process reduced data from 200 source systems from 15 days to 7 • Finance organization was focused on data gathering and not data • Standard data definitions analysis and well defined data governance across 200 Problem source systems and 2,000 • Disparate, fragmented financial systems environment users • Ineffective forecasts were poor predictors of performance • Finance now has flexibility to quickly integrate • No single view of enterprise financial performance acquisitions • System complexity limited ability to adapt to environmental and and adjust to change strategic change • Finance, now spending more time on value- Solution adding analysis • Redefine the role and operating model of the core finance • Improved planning and functions, processes and systems variance analysis process • Implement a Teradata and Planning system as the foundation of – driver-based plans the new financial systems architecture • New Strategy and project • Deploy a shared service finance model scope was implemented in less than 12 month • Create a more agile enterprise to analyze and drive timely decisions 22 > 6/17/2010
  23. 23. The VISION is in place: CFO Dashboards The Art of the Possible - Total Consolidation View of the Company 23 > 6/17/2010
  24. 24. What Does a Good Data Warehouse Give the Finance Function? • A broader range of data • More detailed data • More history • A better analytical environment > Faster response – Support for iterative analysis > More user control > More comprehensive in its ability to answer business questions • A better analytical calculation environment > Faster, better and cheaper • More up-to-date data • More reliable and consistent data • Reduced operational risk > Avoids spreadsheet proliferation 24 > 6/17/2010
  25. 25. Summary: Finance Benefit using Teradata • Faster closure – Closing the books every day > Earlier identification of issues > Easier analysis and validation • Alternative options for new reporting requirements -> 80 % Ad-hoc Reporting • Flexibility to cater for: > New measurement approaches > New products > New portfolios • Strategic (e.g. management control, compliance governance, etc.) • Reduced costs > System > Manpower • Greater business value add > Enhanced financial analysis > Dissemination of financial management knowledge 25 > 6/17/2010
  26. 26. Questions Many thanks for your attention! Dr. Georg Loepp Business Development Manager Banking, Insurance & Healthcare Teradata GmbH Hahnstrasse 43 E 60528 Frankfurt / Germany Tel: +49 (69) 665 29 - 175 Mobile: +49 (172) 82 38 - 444 Fax: +49 (69) 665 29 - 247